Chlamydia trachomatis is the etiological agent of several significant diseases of humans including trachoma, the leading cause of infectious blindness worldwide. It is also the most common cause of sexually transmitted disease in the USA. Other species of medical importance include C. pneumoniae, a causative agent of upper respiratory tract infections and possibly associated with atherosclerosis, and C. psittaci, which is primarily a pathogen of animals but occasionally is transmitted to humans. Chlamydiae are obligate intracellular bacteria that undergo their life cycles entirely within an intracellular vesicle that is isolated from established routes of intracellular vesicle trafficking. Whereas the majority of intracellular parasites are thought to block maturation of the endocytic vesicle to a lysosome, chlamydiae dissociate themselves from this pathway and establish a functional interaction with an exocytic pathway , which delivers sphingolipids from the Golgi apparatus to the plasma membrane. Interaction with this secretory pathway provides a novel pathogenic mechanism allowing chlamydiae to establish themselves in a site not destined to fuse with lysosomes. Chlamydial avoidance of lysosomal fusion appears to occur in two stages. Upon endocytosis by eukaryotic cells, the nascent inclusion is non-fusogenic with any endocytic or exocytic pathway. A second, active phase of lysosomal avoidance requires chlamydial protein synthesis to modify the properties of the inclusion. One of the initial events in chlamydial infection is the expression of a chlamydial gene product(s) that effectively isolates the inclusion from the endosomal/lysosomal pathway and initiates fusion competence with a subset of exocytic vesicles but with minimal interference of normal cellular function. Over the past year, we have shown that chlamydiae express genes in three temporal classes throughout the developmental cycle. Those genes expressed in the early class are heavily weighted toward those that modify the inclusion membrane. These results show potential not only for defining the interactions of chlamydiae with the host cell but will serve as a model system for other obligate intracellular pathogens which occupy vacuoles that do not fuse with lysosomes. Understanding the initial events in chlamydial differentiation including the transition in properties of the endocytic vesicle to one which intersects an exocytic pathway remain significant challenges in understanding the pathogenic mechanisms of chlamydiae.